Darragh McCullough: Is this Common Agricultural Policy (CAP) the fairest ever?

Many farmers ditched drystock to get into dairying

Darragh McCullough Twitter Email

October 26 2021 02:30 AM

Full-time farmers, especially those with large subsidy payments and those with big entitlements per hectare will disagree.

They’ve borne the brunt of the cuts that will see the payments flatten out across the country. It will result in hundreds of millions of euro migrating from the more intensive farming areas in the east across the Shannon to the more marginal lands in the west.

Those who had built up the largest entitlements during the reference years will suffer most.

But after 20 years of money for jam, these farmers can’t say that they didn’t have a chance to get their houses in order.

The decoupling of the payments from farming activity in the early 2000s freed up every farmer to pursue whatever enterprise they wanted, while still hanging onto their CAP payment.

The smart guys saw this opportunity for what it was. Some rented out everything, wrapping up the EU farm subsidies in the lease and pocketing a very nice tax-free income while they turned their attentions to alternatives outside the farm gate.

For those that wanted to stay in farming, they also had options. The most common choice for those with youth on their side was to ditch drystock to get into dairying.

They were able to sell their beef herds or sheep flocks and reinvest the money in a herd of dairy cows.

The EU Single Farm Payment was an income to keep cash in the system for the early years when the dairy was eating up investment and getting going.

I have yet to meet a convert who has not been happy with their decision. As one farmer told me during the worst milk price year back in 2016, “it still beats the hell out of anything I ever made in suckling”.

Milk prices have strengthened every year since, and no other farm enterprise has offered so many a chance to prosper from their labour on the land.

However, there are always the begrudgers. Some beef farmers’ believe that this migration to dairying has somehow ‘robbed’ the beef sector of subsidies.

Of course, there are also plenty of drystock farmers that have stuck with their respective enterprises, content that there will be a return for their effort.

They are as important to the farming sector as any other farmer. But they shouldn’t buy into the propaganda that they are entitled to higher payments just because of their chosen enterprise.

Yes, organic farmers, new entrants, and farmers on marginal land all get top-ups, but this can be justified on the basis that they are providing additional environmental benefits and fresh-blood for the sector.

So to the farmer with entitlements that were worth €400, €600, and €1,000/Ha, I say tough luck.

You were getting a subsidy that was multiples of what the vast majority were receiving. It was based on something you did on your farm over two decades ago. You had all the intervening years to come up with an alternative way to make a living that wouldn’t be so dependent on the tax-payer’s largesse. Did you really think you were going to be entitled to all that money until your dying day?

Unfortunately, many farmers have been led up the garden path for years by farm leaders promising them ‘upward only convergence’ and €200 per cow and the like.

What a load of baloney.

You will also hear plenty of lads complaining that the CAP did nothing for the ‘commercial’ or ‘productive’ farmer.

But taxpayers aren't interested in supporting commercial farmers. Originally this pot of public money was designed to guarantee food security, and subsequently it was continued to prevent a mass exodus from the land.

These two aims have now been superseded by the environmental challenge that both society and farmers face. That’s why nearly every aspect of the next CAP will have environmental objectives woven into it.

Commercial farmers are supposed to be able to make a living from their farming activity, not from taxpayer handouts. Unviable farms have a bigger role to play from now on in protecting our environment rather than our food supply. That’s why the money should go to them.

Not in a way that encourages more output, but in a way that promotes biodiversity, improved water and air quality and carbon sequestration. That might not feel fair for some individuals, but the big picture is the one that counts.

Darragh McCullough runs a mixed farm enterprise in Meath, elmgrovefarm.ie.